On April 5, 2021, the Consumer Financial Protection Bureau (CFPB) proposed changes to Regulation X to assist borrowers affected by the COVID-19 emergency. The CFPB is taking this action to:
- Help ensure that borrowers impacted by the COVID-19 pandemic have an opportunity to be evaluated for loss mitigation before the initiation of foreclosure.
- Establish a temporary COVID-19 emergency pre-foreclosure review period until December 31, 2021, for principal residences
- Temporarily permit mortgage servicers to offer certain loan modifications made available to borrowers experiencing a COVID-19-related hardship based on the evaluation of an incomplete application.
The CFPB also proposes certain amendments to the early intervention and reasonable diligence obligations that Regulation X imposes on mortgage servicers.
The comment period ends on May 10, 2021.